“In the wake of fluctuating global oil prices and exchange rate variation, the government has decided to revise the prices of petroleum products,” it said in a notification.

Since last week, the government was indecisive over the fuel rates. Sources said the Oil & Gas Regulatory Authority and the coalition parties were in favour of decreasing the petroleum products price, however, the finance ministry wanted to increase it.

The government has retained the high speed diesel rate, which stands at Rs247.43. But, the kerosene oil and light diesel prices have been reduced by Rs8.30 and Rs4.26 per litre respectively.

New rates were supposed to be decided last week, however, it was delayed due to Prime Minister Shehbaz Sharif’s trip to Uzbekistan to attend the Shanghai Cooperation Organization.

The government has assured the International Monetary Fund to “increase the petroleum development levy (PDL) up to Rs50 till January”. Such a promise was made when Pakistan received the letter of intent (the document outlining the general plans of an agreement).

Oil prices dipped on Tuesday, following other risk assets lower, as the dollar stayed strong and investors anticipated more central bank interest-rate hikes designed to quell inflation, Reuters reported.

The US Federal Reserve is likely to raise interest rates by another 75 basis points on Wednesday to rein in inflation. Those expectations are weighing on equities, which often move in tandem with oil prices. Other central banks, including the Bank of England, meet this week as well.

Higher rates have bolstered the dollar, which remained near a two-decade high against peers on Tuesday, making oil more expensive for holders of other currencies.

Brent crude futures settled down $1.38, or 1.5%, to $90.62 a barrel, while US West Texas Intermediate crude for October delivery ended at $84.45, down $1.28, on the day of its expiration. The more active November contract settled down $1.42 to $83.94 a barrel.